A Merrill Lynch analyst was fired during the dangerous housing boom for the cardinal sin of acknowledging that there was a housing boom, and it was dangerous.
Nobody saw it coming!
In a new article in Vanity Fair, Lewis tells the story of an analyst at Merrill Lynch who, months before the crisis, said the lending practices of several big Irish banks were the riskiest and most reckless in Europe.
The Irish banks freaked out when they saw the report and demanded that Merrill retract it. Merrill DID retract it, and then rewrote and re-issued a version that was far more flattering to the Irish banks. And at the end of the year, the analyst was canned.
Of course, several months after the report appeared, the financial crisis hit and the Irish banks collapsed.